1990 Anti-mandal agitation and identity politics
ON August 7, 1990, Prime Minister V.P. Singh announced that Other Backward Classes (OBCS) would get 27 per cent reservation in jobs in Central government services and public sector units. The announcement was based on the recommendations of the Mandal Commission, under the aegis of former Bihar Chief Minister B.P. Mandal, which the Morarji Desai government had constituted in 1979 to address the vexed issue of caste discrimination. The V.P. Singh government’s decision took the extent of reservation for OBCS, Scheduled Castes and Scheduled Tribes to 49 per cent, thereby stirring a hornet’s nest.
As thousands of students took to the streets, anti-mandal protests became a defining feature of those days. But it took a gory turn in September 1990 when a Deshbandhu College student, Rajeev Goswami, self-immolated. Though Goswami survived, he became the face of the agitation, and more immolation bids followed. Of the roughly 200 who attempted it, more than 60 succumbed to their burns.
The Mandal moment fragmented north Indian voters decisively on caste lines and was the beginning of powerful caste-based regional parties. Two of the immediate proteges of the movement were politicians who had groomed themselves as socialist champions: Lalu Yadav and Mulayam Singh Yadav, adherents of the socialist icon Ram Manohar Lohia.
The brand of identity politics unleashed by the Mandal moment would create leaders such as Mayawati, who became India’s first female scheduled caste chief minister in 1995 when she won U.P., and would give a major fillip to the Dalit political voice. To counter this, the BJP unleashed the kamandal edition of politics.
ARGUABLY, 1991 was not an ideal period for India to “open up” its economy. There was the looming balance of payments and foreign exchange crisis; inflation had hit a staggering 16.7 per cent in August that year; fiscal deficit was 8.4 per cent; the Soviet Union, India’s long-term ally, had just collapsed; the Gulf region, which was powering up the country’s remittance economy, witnessed a devastating war; and the Congress regime under P.V. Narasimha Rao was a minority government.
That did not deter Rao and his Finance Minister Manmohan Singh from introducing economic reforms that would soon change the colour and character of the country. “No power on earth can stop an idea whose time has come,” Singh quoted Victor Hugo in his Budget speech in July 1991.
As expected, the economic reforms unleashed what many would now call a spectre and others an aiding genie. Very soon, India would see high-growth years. From an average of about 4.4 per cent in the 1970s and a little further in the 1980s, GDP growth started hovering above 5.5 per cent in the 1990s and early 2000s and jumped to 7.1 and upwards of 8 per cent in
the next decades. India’s GDP was valued at about $266 billion. As of 2020, before COVID-19 hit the country’s economy, its GDP was inching towards the $3 trillion mark.
In hindsight, India’s liberalisation has been a mix of hits and misses. A number of sectors that were under the licence raj, such as automotive or aviation, directly benefited from the reforms. Vehicles became much cheaper, transport became affordable, and access to places improved in general.
The global exposure helped companies attract foreign investors and new technologies. This created avenues for more employment. The service sector boomed, although many economists now say the growth in IT services was not really because of the reforms but because of global advances in technology.
The purchasing power of average Indians improved, from a little over $1,000 to about $6,000 now. Parameters such as infant mortality rates, foreign direct investment, and labour force employment improved significantly.
Today, economists point to some of the negative fallouts. The contribution of farming, which
continues to feed more than half of the population, to GDP went downhill during the reform years. The high growth years did not really convert into meaningful growth in jobs, especially in the rural sector and for the urban poor. The focal shift from big capitalists in general in the 1980s and 1990s to a select list of crony capitalists made a handful of Indians very rich, widening the income gap. As of 2020, India’s Gini Coefficient, a measure of income inequality, was 82.3, indicating the rising inequality.
As the reforms also meant more privatisation of public sector companies and increased withdrawal of the state from crucial sectors such as education, health, and priority sector spending, India’s rich got richer, while the poor were robbed of social security and formal jobs.
Overall, it would seem that liberalisation did not lead to greater diversification of the economy nor to labour-intensive activity. Critics also say that it led to environmental destruction, collapse of the welfare state, siphoning off of public money into private hands, stock market scams, and a riot of neoliberal economics.